A new report by the National Association of Realtors shows the real reason why home sales don't crash for long -- rents. When purchase demands slow down, rentals speed up. Rents provide the floor that stops housing prices from major declines.

Home prices going down has been the big news lately, but in the shadows is a statistic that may surprise you. The first quarter of 2008 makes the 24th consecutive quarter that rental prices have escalated nationwide.

According to Reis Inc., a New-York based research firm, the soft home market and stricter loan terms are combining to turn more potential homebuyers into renters.

The troubling part is that renting isn't necessarily better for consumer pocketbooks than owning. A new report by the National Low Income Housing Coalition’s annual report "Out of Reach," suggests that one in seven U.S. households is using more than half their income for shelter. Low-income, minority and first-time homebuyers are the most impacted, suggests the study.

First-time homebuyers are approximately 40 percent of the housing market, so knocking them out knocks out move-up homebuyers who wish to trade up to larger and/or more expensive homes.

One bright spot following the release of the report was the weekly mortgage applications survey from the Mortgage Bankers Association. The trade organization's Market Composite Index found that purchase loan applications increased 5.4 percent from a week earlier. And the Refinance Index found that refinance applications increased 3.4 percent.

Because mortgage interest rates rose slightly for the week, to 5.78 percent from 5.75 percent, the implication is that flat rates weren't the reason for the rise in applications, but that consumers may simply be moving off the bench for the spring homebuying season.

We'll know more as the weeks continue, if there is a relationship between rising rents, and rising home sales and mortgage applications.